Yellen calls for allies to quickly disburse committed funds to Ukraine
US Treasury Secretary Janet Yellen on Tuesday called on partners and allies to make good swiftly on their existing commitments to support Ukraine and to join the United States in doing more as Russia continues its “barbaric” attacks.
Yellen expressed her condolences to Ukrainian Finance Minister Serhiy Marchenko and senior Ukrainian officials for the latest Russian attacks, aimed at the capital Kyiv and other safe-haven cities, and pledged Washington’s continued support.
“Once again, the world has seen the true nature of Russia’s barbaric and illegal war. The United States continues to stand resolutely with Ukraine and the Ukrainian people. We will continue to support you as you rebuild the prosperous and free Ukraine that your country has fought so hard to secure,” Yellen told Marchenko and his delegation before a meeting.
Washington intended to disburse US$4.5 billion (S$6.5 billion) in direct budget support to Ukraine in coming weeks, she said. Congress approved that funding two weeks ago, bringing total US direct budget support for Ukraine to US$13.5 billion, all in grants.
“We’re committed to getting this funding to you as soon as possible because we know how important it is in supporting your brave resistance to Russia’s illegal invasion,” she said.
Washington had also joined with Ukraine’s major creditors to suspend the country’s bilateral debt service payments this year and next year, she said.
“But let me be clear: International support for Ukraine is a collective effort. We are calling on our partners and allies to join us by swiftly disbursing their existing commitments to Ukraine and by stepping up in doing more, both to help Ukraine continue its essential government services and to help Ukraine begin to build and recover,” she said.
Ukraine has said it needs up to US$5 billion a month in long-term commitments to cover its budget costs, including pensions, military spending and to continue servicing its debts.
International creditors have frozen debt payments, but about 80 percent of its payments are to domestic banks.
Yellen’s pointed comments about partners’ commitments reflect mounting frustration among US and Ukrainian officials about the European Union, which pledged US$9 billion in support for Ukraine, but has delivered only US$1 billion thus far.
Germany, in particular, has slowed the process of releasing the funds to Ukraine, sources familiar with the matter say.
Yellen and other Group of Seven (G7) finance officials will meet to discuss Ukraine’s financing and reconstruction needs on Wednesday, on the sidelines of the annual meetings of the International Monetary Fund (IMF) and World Bank.
Officials from the IMF and Ukraine will meet in Vienna next week for technical discussions on Ukraine’s budget with an eye to laying the groundwork for a future full-fledged lending programme.
Germany, the current president of the G7, will host a conference on Ukraine’s recovery in Berlin on Oct 25.